How are the earnings thresholds for noncompetition covenants adjusted annually for Focalpoint Coaching franchisees in Washington?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
Investment Protection Act, in Washington.
A release or waiver of rights executed by a franchisee may not include rights under the Washington Franchise Investment Protection Act or any rule or order thereunder except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel. Provisions such as those which unreasonably restrict or limit the statute of limitations period for claims under the Act, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
Transfer fees are collectable to the extent that they reflect the franchisor's reasonable estimated or actual costs in effecting a transfer.
Pursuant to RCW 49.62.020, a noncompetition covenant is void
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
According to Focalpoint Coaching's 2025 Franchise Disclosure Document, in Washington state, noncompetition covenants have specific earnings thresholds that are adjusted annually for inflation. For an employee of a Focalpoint Coaching franchisee, a noncompetition covenant is void and unenforceable if their annualized earnings from the franchisee do not exceed $100,000 per year. Similarly, for an independent contractor of a Focalpoint Coaching franchisee, a noncompetition covenant is void and unenforceable if their annualized earnings from the franchisee do not exceed $250,000 per year. Both of these earnings amounts are subject to annual adjustments for inflation.
This means that Focalpoint Coaching franchisees in Washington must be aware of these earnings thresholds when implementing noncompetition agreements with their employees or independent contractors. If an employee or independent contractor earns less than the specified amounts (as adjusted for inflation each year), the noncompetition covenant will not be legally enforceable. This is a significant consideration for franchisees in managing their workforce and protecting their business interests.
The FDD specifies that any provisions within the franchise agreement or other related documents that conflict with these limitations are void and unenforceable in Washington. This underscores the importance of adhering to Washington state law regarding noncompetition agreements. Prospective Focalpoint Coaching franchisees should consult with legal counsel to ensure their agreements comply with these regulations and to understand the implications for their business operations in Washington.
In summary, Focalpoint Coaching franchisees in Washington must ensure that their noncompetition agreements with employees and independent contractors comply with state law, particularly regarding earnings thresholds that are adjusted annually for inflation. Failure to do so could render these agreements unenforceable, impacting the franchisee's ability to protect their business interests.